Tenants who are considering using the tenant’s amnesty procedure now have just 8 months left to formally notify their landlord about improvements made to land and buildings where consent or notice was required to enable the improvements to qualify for compensation at waygo (end of tenancy). The process can also be a opportunity, for both landlords and tenants, to agree tenants’ improvements or the respective contributions made towards the cost of them. However, using the statutory process locks those involved in to a timetable which ultimately may involve an application to the Land Court. We therefore recommend that advice is taken and less formal negotiations take place as soon as possible.
Most improvements fall in to one of the following categories:
(a) improvements not requiring consent or intimation to the landlord. This includes liming or marling of land; or
(b) improvements requiring notice prior to the improvement being made. This includes the erection or alteration of buildings (including houses), land drainage, making or improving farm access roads and making or removing permanent fences or hedges; or
(c) improvements requiring consent. This includes laying down of permanent pasture and planting of orchards or fruit bushes.
The amnesty procedure is available for improvements already made and falling within categories (b) and (c) where notice or consent was not obtained prior to the improvement being undertaken. If those improvements would qualify for compensation at waygo but for the lack of notice or consent, then the amnesty can be used to cure that lack of notice or consent.
It is the tenant’s responsibility to start the process and it involves compiling a fairly detailed list of improvements including some justification on why compensation should be available, site meetings and potentially resolving disputes. Once a notice has been served the landlord has two months to object to the claim. Where a notice of objection is received the tenant must decide, thereafter within two months, whether or not to apply to the Land Court for approval of the improvement.
The Tenant Farming Commissioner recommends in his guidance that informal negotiations take place before the statutory process is used. We agree that it would be better to use the next few months to try to progress informal negotiations to establish common ground on the improvements rather than to wait until the last few months of the amnesty period and to then be forced to serve a notice and be locked into a formal and potentially expensive process.
Take up on the amnesty has been slow. Some tenants are concerned that using the amnesty may affect rent. However, tenants’ improvements are not taken in to consideration when assessing rent. It is true that the process can be used to assess and agree the landlord and tenant’s respective contributions towards the cost of improvements. This will be relevant when assessing fair rent.
If you require any further advice on improvements we recommend that you contact our Land and Rural Business team as soon as possible.
